THE JMMB Group, through its private equity vehicle Vertex SME Holdings Limited (Vertex), has taken a 25 per cent stake in ICR Holdings, a car rental company. Vertex is managed by JMMB Securities Limited (JMMBSL).

The stake was acquired during the recent transaction in which ICR Holdings purchased Island Car Rental (ICR) and Jamaica Rental Company (JRC) for $2.7 billion. ICR Holdings is led by banker Ryan Parkes.

The $2.7 billion raised to purchase the car rental companies was funded through debt and equity, with a mix of 70 per cent in bonds and preference shares and 30 per cent in ordinary shares through private placements.

The entities, which are now owned by ICR Holdings, have been operating in the local market for the last half century and have a fleet of over 1,500 vehicles. They offer full-service ground transportation to locals and tourists and also private transfers and executive chauffeur services.

General manager of JMMBSL, Kareem Tomlinson, said his company’s investment in ICR Holdings aligns with the strategic objective of targeting businesses with high growth potential, proven business models, strong management teams, and a sustainable competitive advantage.

“Island Car Rental fits this bill, having been in the transportation industry for 50 years and boasts a solid track record, high cash flow, market dominance, and have shown resilience in its operations even during the recent pandemic,” Tomlinson said. Revenues at ICR Holdings went up by 45 per cent in the company’s last financial year, with expectations for even more growth as the forecast for tourist arrivals continue to trend upward.

ICR Holdings’ CEO Parkes, in commenting on the partnership, said that he looks forward to building on the rich legacy of his predecessor Michael Campbell as he looks to leverage the strength of the brand while exploring expansion plans.

“I welcome Vertex’s partnership at this time, particularly in light of their extensive experience and expertise within the region. I look forward to leveraging this experience and expertise as we advance ICR’s growth agenda across new markets,” he also said, further noting that JMMBSL, in its role as equity partner, will add value to the company through its appointment of two directors to the board, while his management team oversees the day-to-day operation.

After its first year in the market, Vertex, which in May of this year also secured a minority stake in the Guyanese-based, Corum Restaurant Group Inc, said it remains bullish on plans to close more transactions. It currently has a pipeline of about 20 deals it wants to execute with entities operating across several industries, locally and in the wider Caribbean.

“Vertex is currently in the advanced stages of several [of] its pipeline opportunities. These companies have tremendous growth potential which we believe can be unlocked with the capital and expertise of the JMMBSL team. As Vertex looks to accelerate its support of more SMEs through equity investment, it is expected to also, over the short term, return to the capital markets for additional capital raise for deployment in additional opportunities,” Tomlinson said.

Keith Duncan, CEO of the JMMB Group of which JMMBSL is a subsidiary, in touting the strength of Vertex as the group’s first private equity vehicle, said it will add value to the local equity space and its investors by supporting the growth of regional companies as it creates a network for them to forge mutually beneficial partnerships.

“In addition to offering more growth funding opportunities for mid-sized businesses, this investment vehicle will also enable the JMMB Group to diversify its revenue stream and to focus on capital-efficient growth,” he stated.